Mumias Sugar owes farmers, employees Sh1.4bn, says CEO

More than 500 contracted farmers who delivered their cane to Mumias Sugar Company have not been paid since mid-2015

The growers are owed a total of Sh900 million, the company chief executive officer Nashon Aseka has said.

READ: No sweet news as sugar prices to remain high

He said employees have also not been paid for the last four months raising the salary bill to about Sh500 million.

Me Aseka blamed the arrears on financial challenges “which have made the situation at Mumias unfavourable”.

“We are still waiting for the Sh500 million the President promised us so that we can cut down on some of these debts as we prepare to start milling,” Mr Aseka told journalists in his office in Mumias noting that the company needs over Sh5.2 billion to resume full operations.

READ: Lack of cane cited as sugar industry’s bitter hindrance

He said normalcy will resume once they start operations which is expected to kick off next month.

The CEO said the miller requires a lot of goodwill for its revival to succeed.

“The government being our largest shareholder is committed to give us more money. We are in talks with the State on modalities of allocating us the money to enable us stand on our own,” he added.

Mr Aseka accused former managers of failing to diagnose the problem at Mumias which he claimed started 10 years ago.

He dismissed claims that the lack of sugarcane is the only problem that Mumias faces.

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“Many things were not done right at Mumias leading to deterioration of operations in terms of cane development and factory maintenance,” said Mr Aseka noting that the cane should be developed near the factory.